1031-00004 · Hudson Yards West Mortgage LLC · Entity Formation

independent-director-agreement-hyw-mortgage.docx DOCUMENT Real Estate

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INDEPENDENT DIRECTOR DESIGNATION AGREEMENT

HUDSON YARDS WEST MORTGAGE LLC

a Delaware Limited Liability Company

Dated as of ______________, 2025

INDEPENDENT DIRECTOR DESIGNATION AGREEMENT

This INDEPENDENT DIRECTOR DESIGNATION AGREEMENT (this "Agreement") is entered into as of ____, 2025, by and among **HUDSON YARDS WEST MORTGAGE LLC**, a Delaware limited liability company (the "Company" or "HYW Mortgage"), **METROPOLITAN TRANSIT DEVELOPMENT CORP.**, an Illinois corporation ("MTDC" or the "Member"), and **______ (the "Independent Director"), and acknowledged and agreed by IRONCLAD NATIONAL BANK, N.A., a national banking association, in its capacity as Administrative Agent under the Senior Loan Agreement (as defined below) (the "Senior Lender" or "Ironclad"), and GRANITE PEAK CAPITAL PARTNERS, LP**, a Delaware limited partnership (the "Mezzanine Lender" or "Granite Peak"), each in its capacity as a third-party beneficiary hereof.

RECITALS

WHEREAS, Hudson Yards West Mortgage LLC ("HYW Mortgage" or the "Company") is a Delaware limited liability company and special purpose entity, duly formed and existing under the laws of the State of Delaware, organized for the purpose of owning, developing, and financing the mixed-use commercial and residential development project located at 450 West 34th Street, New York, New York 10001 (Borough of Manhattan; Tax Block 729; Tax Lots 1, 5, 12, and 15) (the "Project"), which Project includes office, retail, and residential components with an aggregate estimated development cost in excess of Six Hundred Seventy-Five Million Dollars ($675,000,000);

WHEREAS, Metropolitan Transit Development Corp. ("MTDC"), as the sole member of the Company, organized the Company as a bankruptcy-remote, single purpose entity in connection with the Company's entry into that certain Senior Mortgage Loan in the original principal amount of Four Hundred Seventy-Five Million Dollars ($475,000,000) with Ironclad National Bank, N.A. ("Ironclad"), as Administrative Agent, and the syndicate of lenders party thereto (the "Senior Loan"), and the related mezzanine financing in the original principal amount of Two Hundred Million Dollars ($200,000,000) provided by Granite Peak Capital Partners, LP ("Granite Peak"), to Hudson Yards West Mezzanine LLC ("HYW Mezzanine"), a Delaware limited liability company and the direct parent of the Company (the "Mezzanine Loan");

WHEREAS, the Amended and Restated Limited Liability Company Agreement of the Company, dated as of ____, 2025 (as amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms, the "LLC Agreement"), requires that the Company at all times have at least one (1) Independent Director (as defined herein) whose affirmative vote is required before the Company may take certain Material Actions (as defined herein);

WHEREAS, the requirement for an Independent Director is a condition precedent to the closing and initial funding of the Senior Loan and the Mezzanine Loan and is intended to ensure the separateness of the Company from its member and affiliates and to minimize the risk of a substantive consolidation of the Company's assets and liabilities with those of any other person or entity in any bankruptcy, insolvency, or similar proceeding, consistent with the nonconsolidation opinion delivered by counsel in connection with the closing of the Senior Loan;

WHEREAS, the Independent Director has been selected by MTDC, as sole Member of the Company, and is willing to serve as an Independent Director of the Company on the terms and conditions set forth herein, having represented that the Independent Director satisfies each of the Independence Requirements (as defined herein) and possesses experience in serving as an independent director or independent manager for special purpose entities in structured finance and commercial real estate transactions;

WHEREAS, reference is hereby made to that certain Senior Mortgage Loan Agreement dated as of ____, 2025 (as amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms, the "Senior Loan Agreement"), among the Company, as Borrower, and Ironclad National Bank, N.A., as Administrative Agent for the benefit of itself and the syndicate of lenders party thereto, and to that certain Mezzanine Loan Agreement dated as of ____, 2025 (as amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms, the "Mezzanine Loan Agreement," and together with the Senior Loan Agreement, the "Loan Agreements"), among Hudson Yards West Mezzanine LLC, as Borrower, and Granite Peak Capital Partners, LP, as Lender; and

WHEREAS, it is the intent of the parties that this Agreement be executed and delivered on or prior to the closing date of the Senior Loan and the Mezzanine Loan and that the Independent Director commence service as of the Effective Date (as defined herein);

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

SECTION 1 — DEFINITIONS

As used in this Agreement, the following terms shall have the meanings ascribed to them below:

"Agreement" shall mean this Independent Director Designation Agreement, as it may be amended, restated, supplemented, or otherwise modified from time to time in accordance with Section 15.4 hereof.

"Annual Fee" shall have the meaning set forth in Section 8 hereof.

"Certificate of Formation" shall mean the Certificate of Formation of the Company filed with the Secretary of State of the State of Delaware, as the same may be amended or restated from time to time in accordance with the LLC Agreement and this Agreement.

"Company" shall mean Hudson Yards West Mortgage LLC, a Delaware limited liability company.

"Covered Person" shall have the meaning ascribed to such term in the LLC Agreement, and shall include the Independent Director in the Independent Director's capacity as such.

"Effective Date" shall have the meaning set forth in Section 3 hereof.

"HYW Mezzanine" shall mean Hudson Yards West Mezzanine LLC, a Delaware limited liability company and the direct parent of the Company.

"Independence Requirements" shall mean the criteria enumerated in Section 2 hereof, which are intended to conform to, and incorporate by reference, the requirements of the LLC Agreement, the Senior Loan Agreement, and the Mezzanine Loan Agreement, as well as the rating criteria of Pinnacle Ratings Group applicable to independent directors of special purpose entities in rated transactions (including, without limitation, rating identifier PRG-MTDC-A-2024-1187).

"Independent Director" shall mean the individual designated pursuant to this Agreement to serve in such capacity, initially being ______, and any successor Independent Director appointed in accordance with Section 7 hereof; provided, that any person serving as Independent Director must at all times satisfy the Independence Requirements set forth in Section 2 hereof.

"LLC Agreement" shall mean the Amended and Restated Limited Liability Company Agreement of the Company dated as of ____, 2025, as the same may be further amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms (subject to the restrictions on amendment without Independent Director consent as set forth therein and in Section 5 hereof).

"Loan Agreements" shall mean, collectively, the Senior Loan Agreement and the Mezzanine Loan Agreement.

"Material Action" shall mean each of the enumerated actions set forth in Section 5 hereof for which the prior affirmative consent of the Independent Director is required, as further described in the LLC Agreement and the Senior Loan Agreement.

"Member" shall mean MTDC, as the sole member of the Company, and its permitted successors and assigns in such capacity.

"Mezzanine Lender" shall mean Granite Peak Capital Partners, LP, and its successors and assigns under the Mezzanine Loan Agreement.

"Mezzanine Loan" shall mean the mezzanine loan in the original principal amount of Two Hundred Million Dollars ($200,000,000) made by the Mezzanine Lender to HYW Mezzanine pursuant to the Mezzanine Loan Agreement.

"Mezzanine Loan Agreement" shall have the meaning set forth in the Recitals hereof.

"MTDC" shall mean Metropolitan Transit Development Corp., an Illinois corporation.

"Pinnacle Ratings Group" shall mean Pinnacle Ratings Group, Inc. and any successor rating agency.

"Project" shall have the meaning set forth in the Recitals hereof.

"Senior Lender" shall mean Ironclad National Bank, N.A., in its capacity as Administrative Agent under the Senior Loan Agreement, and its successors and assigns in such capacity.

"Senior Loan" shall mean the senior mortgage loan in the original principal amount of Four Hundred Seventy-Five Million Dollars ($475,000,000) made by the syndicate of lenders party to the Senior Loan Agreement to the Company pursuant to the Senior Loan Agreement.

"Senior Loan Agreement" shall have the meaning set forth in the Recitals hereof.

"Separateness Covenants" shall mean the covenants set forth in the LLC Agreement and the Loan Agreements requiring the Company to maintain its existence as a legal entity separate and distinct from the Member and any other person, as more particularly summarized in Exhibit B attached hereto.

"SPE Requirements" shall mean the single-purpose entity and bankruptcy-remoteness requirements set forth in the Senior Loan Agreement (and incorporated by reference in the Mezzanine Loan Agreement), the LLC Agreement, and the nonconsolidation opinion delivered by counsel in connection with the closing of the Senior Loan, as more particularly summarized in Exhibit B attached hereto.

Capitalized terms used but not otherwise defined in this Agreement shall have the meanings ascribed to such terms in the LLC Agreement. If any capitalized term is not defined in this Agreement or the LLC Agreement, such term shall have the meaning ascribed to it in the Senior Loan Agreement. In the event of any conflict between the definitions set forth in this Agreement and those set forth in the LLC Agreement or the Senior Loan Agreement, the definitions set forth in this Agreement shall control for purposes of interpreting this Agreement, and the definitions set forth in the Senior Loan Agreement shall control for purposes of determining compliance with the SPE Requirements and Separateness Covenants.

SECTION 2 — INDEPENDENCE REQUIREMENTS; QUALIFICATION

2.1 Independence Representations and Covenants. The Independent Director represents, warrants, and covenants that at the time of designation and at all times throughout the term of the Independent Director's service hereunder, the Independent Director:

(a) Is not, and has not been at any time during the preceding five (5) years: (i) a stockholder, member, partner, director (other than as an independent director or independent manager), officer, employee, affiliate, associate, supplier, or creditor of the Company, the Member (MTDC), HYW Mezzanine, or any of their respective affiliates (other than in a prior capacity as an independent director or independent manager of a special purpose entity that is not affiliated with MTDC and in which the Independent Director's service was limited to the role of independent director or independent manager); (ii) a customer, supplier, consultant, or other person who derives more than a de minimis amount of revenues, fees, or other compensation from the Company, MTDC, or any affiliate of MTDC (for purposes of this clause, "de minimis" shall mean an amount not exceeding Five Thousand Dollars ($5,000) in any twelve-month period); or (iii) a member of the immediate family (including spouse, domestic partner, parent, child, sibling, or any person sharing the Independent Director's household) of any person described in clauses (i) or (ii) above;

(b) Is not, and has not been at any time during the preceding five (5) years, a director, officer, employee, partner, member, agent, representative, or consultant of Ironclad National Bank, N.A., Granite Peak Capital Partners, LP, Ridgeline Savings Bank, Atlas Mutual Insurance Company, Harborview Federal Savings Bank, Meridian Pacific Bank, or any other lender under the Senior Loan or the Mezzanine Loan, or any affiliate, parent, subsidiary, or successor of any of the foregoing entities, and has not received any compensation, fees, or other remuneration from any such entity (other than fees payable for service as an independent director of an unaffiliated entity);

(c) Has prior experience serving as an independent director or independent manager of a special purpose entity in structured finance, securitization, or commercial mortgage-backed securities ("CMBS") transactions, and possesses a working familiarity with the purposes and responsibilities of an independent director in a bankruptcy-remote structure;

(d) Understands and acknowledges the duties described in this Agreement and in the LLC Agreement, including, without limitation, the obligation to consider the interests of the Company and its creditors (including the Senior Lender and the Mezzanine Lender) in connection with Material Actions, and the obligation to exercise independent judgment in passing upon proposed Material Actions without direction from or deference to the Member or its affiliates;

(e) Meets such additional independence criteria as may be required from time to time by Pinnacle Ratings Group (currently reflected in rating identifier PRG-MTDC-A-2024-1187) in connection with the MTDC credit rating, any securitization, syndication, or other disposition of the Senior Loan or the Mezzanine Loan, or any future rated transaction involving the Company or HYW Mezzanine; and

(f) Is not a person with respect to whom there exist any facts, circumstances, or relationships (financial, familial, professional, or otherwise) that would, in the reasonable judgment of a disinterested observer, compromise or appear to compromise the Independent Director's ability to exercise independent and impartial judgment in connection with any Material Action.

2.2 Ongoing Compliance. The Independent Director shall continuously satisfy each of the Independence Requirements set forth in this Section 2 throughout the term of the Independent Director's service. The Independent Director shall promptly (and in any event within five (5) business days) notify the Company, the Member, the Senior Lender, and the Mezzanine Lender in writing if the Independent Director at any time ceases to satisfy, or becomes aware of any facts or circumstances that may cause the Independent Director to cease to satisfy, any of the foregoing Independence Requirements.

2.3 Annual Certification. The Independent Director shall deliver to the Company, the Senior Lender, and the Mezzanine Lender, on or before January 15 of each calendar year during the term of the Independent Director's service (and upon the Independent Director's initial appointment), a written certification in the form attached hereto as Exhibit A confirming the Independent Director's continued compliance with the Independence Requirements.

SECTION 3 — DESIGNATION AND APPOINTMENT

3.1 Appointment. MTDC, as the sole Member of the Company, hereby designates and appoints ______ as the Independent Director of the Company, effective as of ____, 2025 (the "Effective Date"), which date shall be on or before the closing date of the Senior Loan (target closing date: June 15, 2025). The Independent Director hereby accepts such designation and appointment and agrees to serve in such capacity on the terms and conditions set forth in this Agreement and in the LLC Agreement.

3.2 Authorization. The Independent Director is designated pursuant to and in accordance with Article _ of the LLC Agreement, which provides for the appointment of at least one (1) Independent Director, and Section _ of the Senior Loan Agreement, which requires the Company to maintain at least one (1) Independent Director satisfying the Independence Requirements at all times while any amount remains outstanding under the Senior Loan.

3.3 Condition Precedent. The parties acknowledge and agree that the appointment of the Independent Director is a condition precedent to the initial funding of the Senior Loan under the Senior Loan Agreement and to the initial funding of the Mezzanine Loan under the Mezzanine Loan Agreement. Neither the Senior Lender nor the Mezzanine Lender shall be obligated to fund any amount under the respective Loan Agreements until this Agreement has been duly executed and delivered by all parties hereto and the Independent Director has commenced service.

3.4 Company Records and Filings. The Independent Director shall be listed in the Company's books and records as an Independent Director. To the extent required by applicable law or the LLC Agreement, the Company shall reflect the Independent Director's designation in filings with the Secretary of State of the State of Delaware or any other applicable governmental authority. The Company shall also provide a copy of this Agreement (or a summary thereof) to any rating agency, servicer, or trustee that may require evidence of the Independent Director's appointment in connection with any securitization or syndication of the Senior Loan.

SECTION 4 — DUTIES AND RESPONSIBILITIES

4.1 Scope of Duties. The Independent Director's duties and responsibilities under this Agreement and the LLC Agreement are strictly limited to the following:

(a) Participating in deliberations concerning, and voting upon, any proposed Material Action (as enumerated in Section 5 hereof), upon receipt of notice thereof from the Member or any officer of the Company;

(b) Receiving and reviewing notice of any proposed Material Action from the Member, any officer, or any authorized representative of the Company, together with such supporting documentation and information as is reasonably necessary for the Independent Director to evaluate the proposed Material Action;

(c) Exercising good faith business judgment independently of the Member and its affiliates in determining whether to consent to any Material Action, taking into account the considerations set forth in Section 4.1(d) below;

(d) Considering, in connection with any determination with respect to a proposed Material Action, the interests of the Company as a separate legal entity, the interests of the Company's creditors (including, without limitation, the Senior Lender and the Mezzanine Lender), and the interests of all other stakeholders in the Company, and giving appropriate weight to such interests in light of the Company's status as a bankruptcy-remote, single purpose entity; and

(e) Performing such other duties as are expressly set forth in the LLC Agreement or the Senior Loan Agreement with respect to the role of the Independent Director, including, without limitation, executing any written consent or resolution required to evidence the Independent Director's approval or disapproval of a proposed Material Action.

4.2 No Management Authority. The Independent Director shall not have any management authority over, or fiduciary obligations with respect to, the day-to-day operations, business strategy, or commercial affairs of the Company beyond those expressly set forth in this Agreement and the LLC Agreement. The Member shall retain sole authority and responsibility for the management and conduct of the Company's business in all respects, subject to the Independent Director's consent rights over Material Actions. The Independent Director shall not be responsible for monitoring the Company's compliance with the Loan Agreements, the Separateness Covenants, or the SPE Requirements except as such compliance may be relevant to the Independent Director's consideration of a proposed Material Action.

4.3 No Authority to Bind. The Independent Director shall have no authority to bind the Company, to execute agreements or instruments on behalf of the Company, or to act as an agent of the Company, except as expressly set forth in this Agreement or the LLC Agreement with respect to the approval or disapproval of Material Actions.

4.4 Independent Contractor Status. The Independent Director shall not be deemed to be an "employee" of the Company, the Member, or any affiliate of the Member for any purpose, including, without limitation, for purposes of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), the Internal Revenue Code of 1986, as amended (the "Code"), federal, state, or local employment tax withholding, workers' compensation, unemployment insurance, or any other employment-related law or regulation. The Independent Director shall be solely responsible for the payment of all taxes arising from or relating to the compensation received by the Independent Director under this Agreement.

SECTION 5 — MATERIAL ACTIONS; CONSENT RIGHTS

5.1 Enumerated Material Actions. The Company and the Member hereby covenant and agree that neither the Company nor any person acting on behalf of the Company shall take any of the following actions (each, a "Material Action") without the prior unanimous written consent of the Independent Director (together with the consent of the Member as required by the LLC Agreement):

(a) Filing or consenting to the filing of any petition for relief under the United States Bankruptcy Code (Title 11 of the United States Code), as amended from time to time, or any similar proceeding under any federal, state, or foreign bankruptcy, insolvency, reorganization, receivership, dissolution, or similar law, on behalf of the Company;

(b) Consenting to the institution of involuntary bankruptcy or insolvency proceedings against the Company, or failing to contest in a timely and appropriate manner any such involuntary proceeding;

(c) Consenting to the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator, or other similar official for the Company or for any substantial part of the Company's assets, or failing to contest in a timely and appropriate manner any such appointment;

(d) Making an assignment for the benefit of creditors of the Company, or admitting in writing the Company's inability to pay its debts generally as they become due;

(e) Admitting in writing the Company's inability to pay its debts as they become due, or taking any action that would constitute an act of insolvency under applicable law;

(f) Dissolving, liquidating, winding up, or terminating the Company, whether voluntarily or by consent;

(g) Merging or consolidating the Company with or into any other entity, or converting the Company into another form of entity;

(h) Transferring all or substantially all of the Company's assets, or any interest in the Project, other than in accordance with the express terms of the Loan Agreements and the LLC Agreement;

(i) Amending, modifying, restating, or supplementing the LLC Agreement or the Certificate of Formation in a manner that would (i) modify, limit, or eliminate any of the SPE Requirements or the Separateness Covenants, (ii) modify the rights, duties, qualifications, or consent rights of the Independent Director, (iii) adversely affect the interests of the Senior Lender or the Mezzanine Lender, or (iv) change the purpose of the Company or expand the scope of the Company's permitted activities beyond those contemplated by the Loan Agreements;

(j) Incurring any indebtedness, guaranteeing the obligations of any other person, or creating or permitting any lien on the Company's assets, other than as expressly permitted under the Senior Loan Agreement and the Mezzanine Loan Agreement;

(k) Engaging in any transaction with the Member or any affiliate of the Member except on arm's-length terms in the ordinary course of business and in compliance with the Separateness Covenants;

(l) Taking any action, or failing to take any action, that would cause the Company to fail to satisfy any of the Separateness Covenants or the SPE Requirements set forth in the LLC Agreement, the Senior Loan Agreement, or the Mezzanine Loan Agreement.

5.2 Standard for Evaluation of Bankruptcy-Related Actions. The Independent Director shall not be required to consider the interests of the Member or any affiliate of the Member (including MTDC) to the extent that such interests conflict with the interests of the Company's creditors (including the Senior Lender and the Mezzanine Lender) in passing upon any Material Action, particularly those described in clauses (a) through (f) of Section 5.1 above. In evaluating any proposed Material Action described in clauses (a) through (f) of Section 5.1, the Independent Director shall give primary consideration to the interests of the Company as a separate legal entity and the interests of the Company's creditors and shall exercise independent judgment free from the direction, influence, or control of the Member.

5.3 Enforceability by Third-Party Beneficiaries. The consent right of the Independent Director with respect to Material Actions is a fundamental term of this Agreement, the LLC Agreement, and the Loan Agreements. Such consent right shall be enforceable by the Senior Lender and the Mezzanine Lender as express third-party beneficiaries hereof, and the Company, the Member, and the Independent Director each acknowledge and agree that the Senior Lender and the Mezzanine Lender are relying upon the enforceability of the Independent Director's consent rights in entering into the Loan Agreements and advancing funds thereunder. Any Material Action taken without the prior written consent of the Independent Director shall be void and of no force or effect.

5.4 Form of Consent. The Independent Director's consent to a Material Action may be evidenced by a written consent or resolution executed by the Independent Director, or by the Independent Director's affirmative vote at a duly convened meeting of the members and Independent Director of the Company at which the Independent Director is present in person or by telephone or video conference. The Company shall retain a copy of each such consent or resolution in its books and records and shall promptly deliver a copy to the Senior Lender and the Mezzanine Lender upon request.

SECTION 6 — STANDARD OF CARE; EXCULPATION

6.1 Standard of Care. The Independent Director shall exercise the care that a reasonably prudent person in a like position would exercise under similar circumstances. The Independent Director shall act in good faith and in a manner that the Independent Director reasonably believes to be in the best interests of the Company, giving due consideration to the interests of the Company's creditors (including the Senior Lender and the Mezzanine Lender) as contemplated by this Agreement and the LLC Agreement.

6.2 Exculpation. The Independent Director shall not be liable to the Company, the Member, the Senior Lender, the Mezzanine Lender, or any other person for any act or omission in the performance of the Independent Director's duties under this Agreement or the LLC Agreement, except for acts or omissions constituting willful misconduct, actual fraud, or gross negligence. Without limiting the generality of the foregoing, the Independent Director shall not be liable for (a) any error in judgment made in good faith, (b) any action taken or omitted to be taken in reliance upon the advice of legal counsel, financial advisors, or other professionals retained by the Company, or (c) any action taken or omitted to be taken in accordance with the direction of the Member, provided that the Independent Director acted in good faith and such action or omission does not constitute willful misconduct, actual fraud, or gross negligence.

6.3 Delaware Law. The parties acknowledge that Section 18-1101(e) of the Delaware Limited Liability Company Act, 6 Del. C. § 18-1101(e), permits a limited liability company agreement to expand, restrict, or eliminate the duties (including fiduciary duties) and liabilities of any person, including a member, manager, or other person, to a limited liability company or to another member or manager or other person that is a party to or is otherwise bound by a limited liability company agreement. The parties hereby confirm that the LLC Agreement and this Agreement may expand, restrict, or eliminate the duties and liabilities of the Independent Director to the maximum extent permitted under Delaware law, and that the standard of care and exculpation provisions set forth in this Section 6 are contractually agreed modifications to any default fiduciary duties that might otherwise apply.

6.4 No Personal Liability. The Independent Director shall not be personally liable for the debts, obligations, or liabilities of the Company, whether arising in contract, tort, or otherwise, solely by reason of serving as Independent Director. No creditor or other person having any claim against the Company shall have any recourse against the Independent Director in the Independent Director's personal capacity for the satisfaction of such claim, except to the extent of any claim against the Independent Director arising from the Independent Director's willful misconduct, actual fraud, or gross negligence.

6.5 Duty of Good Faith; No Obligation to Maximize Member Value. The Independent Director's sole duty in connection with any proposed Material Action shall be the duty of good faith as described in this Agreement and the LLC Agreement. The Independent Director shall have no obligation to maximize value for the Member or to defer to the business judgment of the Member. The Independent Director's consideration of the interests of the Company's creditors, particularly in the zone of insolvency or in connection with a proposed bankruptcy filing, shall not be deemed a breach of any duty owed to the Member, and the Member hereby expressly waives any claim against the Independent Director arising from the Independent Director's good faith exercise of the consent rights set forth in Section 5 hereof.

SECTION 7 — TERM; REMOVAL; REPLACEMENT

7.1 Term. The Independent Director's term of service shall commence on the Effective Date and shall continue until the earliest to occur of: (a) the date on which the Senior Loan and the Mezzanine Loan have been irrevocably repaid in full and all obligations of the Company and HYW Mezzanine under the Loan Agreements (including, without limitation, any indemnification obligations) have been indefeasibly discharged in full; (b) the effective date of the Independent Director's resignation, removal, or death, subject to the successor appointment requirements set forth in Sections 7.2 and 7.3 below; or (c) the dissolution of the Company following the full and irrevocable repayment of the Senior Loan and the Mezzanine Loan and the discharge of all obligations under the Loan Agreements.

7.2 Resignation. The Independent Director may resign from service upon not less than thirty (30) days' prior written notice to the Company, the Member, the Senior Lender, and the Mezzanine Lender, delivered in accordance with Section 14 hereof; provided, however, that such resignation shall not become effective until a successor Independent Director who satisfies each of the Independence Requirements set forth in Section 2 hereof has been duly designated by the Member and has accepted appointment in writing and the Company has delivered to the Senior Lender and the Mezzanine Lender a replacement Independent Director Designation Agreement and such other documentation as the Senior Lender or the Mezzanine Lender may reasonably request. In no event shall any resignation of the Independent Director result in a vacancy in the position of Independent Director while any amount remains outstanding under the Senior Loan or the Mezzanine Loan.

7.3 Removal. The Independent Director may be removed, with or without cause, only by the Member; provided, that (a) no such removal shall be effective without at least ten (10) business days' prior written notice to the Senior Lender and the Mezzanine Lender, delivered in accordance with Section 14 hereof, specifying the reasons for the removal (if any) and identifying the proposed successor Independent Director, and (b) no removal shall become effective unless and until a successor Independent Director who satisfies each of the Independence Requirements set forth in Section 2 hereof has been duly designated by the Member, has accepted appointment in writing, and the Company has delivered to the Senior Lender and the Mezzanine Lender a replacement Independent Director Designation Agreement and such other documentation as the Senior Lender or the Mezzanine Lender may reasonably request.

7.4 Replacement. Any successor Independent Director must satisfy each of the Independence Requirements of Section 2 hereof and must be reasonably acceptable to the Senior Lender and the Mezzanine Lender. The Company shall deliver to the Senior Lender and the Mezzanine Lender, at least five (5) business days prior to the effective date of any successor's appointment: (a) a fully executed replacement Independent Director Designation Agreement in substantially the form of this Agreement; (b) a completed Independence Certification in the form of Exhibit A attached hereto, executed by the proposed successor; and (c) such other documentation as the Senior Lender or the Mezzanine Lender may reasonably request, including evidence of the successor's qualifications and experience.

7.5 Vacancy. At no time while any amount remains outstanding under the Senior Loan or the Mezzanine Loan shall the Company be without an Independent Director who satisfies each of the Independence Requirements set forth in Section 2 hereof. Any period during which the Company does not have a duly appointed Independent Director satisfying the Independence Requirements shall constitute an event of default under the Senior Loan Agreement and the Mezzanine Loan Agreement, and the Member and the Company shall use their best efforts to fill any vacancy as promptly as practicable (and in any event within ten (10) business days of the occurrence of such vacancy).

SECTION 8 — COMPENSATION

8.1 Annual Fee. The Company shall pay the Independent Director an annual fee of $____ (the "Annual Fee"), payable in equal quarterly installments in advance on January 1, April 1, July 1, and October 1 of each calendar year during the term of the Independent Director's service (prorated for any partial quarter at the commencement or termination of service), in consideration for the Independent Director's agreement to serve as Independent Director and to be available to review and act upon Material Actions as and when presented.

8.2 Per-Meeting Fee. In addition to the Annual Fee, the Company shall pay the Independent Director a fee of $____ for each meeting, telephonic or video conference, or written consent action in which the Independent Director participates (each, a "Meeting Fee"). Meeting Fees shall be payable within thirty (30) days following the date of the applicable meeting or written consent action.

8.3 Operating Expense. All compensation payable to the Independent Director under this Section 8 shall be treated as an operating expense of the Company and shall be payable regardless of whether any Material Action is submitted to the Independent Director for consent during the applicable period. The Independent Director's entitlement to the Annual Fee and any Meeting Fee shall not be contingent upon the outcome of any vote or consent by the Independent Director on any proposed Material Action.

8.4 Non-Contingent Compensation. The Independent Director's fees shall not be contingent upon the outcome of any vote or consent by the Independent Director. No bonus, incentive, or success-based compensation shall be paid to the Independent Director in connection with the Independent Director's service hereunder.

8.5 Permitted Expense Under Loan Agreements. Payment of Independent Director compensation hereunder shall be a permitted operating expense under the Senior Loan Agreement and shall not be subject to any cash sweep, lockbox restriction, subordination, or other restriction on payment except as expressly provided in the Senior Loan Agreement, the Mezzanine Loan Agreement, or any intercreditor agreement among the Senior Lender, the Mezzanine Lender, and the Company or HYW Mezzanine. The Company shall include the estimated annual Independent Director compensation in its operating budget submitted to the Senior Lender and the Mezzanine Lender.

8.6 Expense Reimbursement. The Company shall reimburse the Independent Director for all reasonable and documented out-of-pocket expenses incurred by the Independent Director in connection with the performance of the Independent Director's duties hereunder, including, without limitation, travel expenses, document review expenses, and expenses of professional advisors consulted by the Independent Director in connection with any proposed Material Action, subject to the Company's reasonable expense reimbursement policies as in effect from time to time.

SECTION 9 — INDEMNIFICATION

9.1 Scope. The Company shall indemnify, defend, and hold harmless the Independent Director from and against any and all claims, actions, suits, proceedings, investigations, demands, losses, damages, liabilities, judgments, fines, penalties, costs, and expenses (including reasonable attorneys' fees, expert witness fees, and disbursements) (collectively, "Losses") arising out of or relating to the Independent Director's service in the capacity of Independent Director under this Agreement or the LLC Agreement, including, without limitation, any Losses arising out of any Material Action or the Independent Director's vote or consent (or refusal to vote or consent) with respect thereto; provided, however, that the Company shall not be obligated to indemnify the Independent Director to the extent that any such Losses are finally determined by a court of competent jurisdiction to have arisen from the Independent Director's willful misconduct, actual fraud, or gross negligence.

9.2 Advancement. The Company shall advance to the Independent Director, promptly upon written request, the costs of defense of any claim, action, suit, proceeding, or investigation with respect to which the Independent Director may be entitled to indemnification under this Section 9 (including reasonable attorneys' fees and disbursements incurred by the Independent Director in connection therewith), upon receipt of an undertaking by the Independent Director to repay such amounts if it is ultimately determined by a court of competent jurisdiction, in a final and non-appealable judgment, that the Independent Director is not entitled to indemnification hereunder. The Independent Director's right to advancement of expenses shall not be subject to any requirement that the Independent Director first seek recovery from any other source.

9.3 Insurance. The Company shall maintain, at its own expense, directors' and officers' liability insurance covering the Independent Director in an amount not less than Five Million Dollars ($5,000,000) and on terms (including coverage for acts and omissions of the Independent Director in the Independent Director's capacity as such) reasonably acceptable to the Senior Lender. The Company shall provide evidence of such insurance coverage to the Senior Lender and the Independent Director upon request.

9.4 Survival. The indemnification obligations of the Company under this Section 9 shall survive the termination or expiration of this Agreement, the Independent Director's resignation or removal, and the dissolution, liquidation, or winding up of the Company, and shall be binding on any successor to the Company, whether by merger, consolidation, acquisition of assets, or otherwise. The Company's indemnification obligations shall continue in full force and effect for a period of six (6) years following the termination of the Independent Director's service.

9.5 Personal Right. The Independent Director's right to indemnification and advancement of expenses hereunder is personal to the Independent Director and shall not inure to the benefit of any third party other than the Independent Director's heirs, executors, administrators, and personal representatives.

9.6 Source of Payment. The Company's indemnification obligations under this Section 9 shall be payable solely from the assets of the Company. MTDC, in its capacity as sole Member, shall have no personal liability for the Company's indemnification obligations hereunder except to the extent that MTDC has separately agreed in writing to fund the Company's obligations or to the extent that MTDC has received distributions from the Company in violation of the LLC Agreement or the Loan Agreements.

9.7 Non-Exclusivity. The indemnification and advancement rights provided in this Section 9 are in addition to, and not in lieu of, any other rights to which the Independent Director may be entitled under the LLC Agreement, any separate indemnification agreement, or applicable law. To the extent any provision of this Section 9 conflicts with any corresponding provision of the LLC Agreement, the provision that provides greater protection to the Independent Director shall control.

SECTION 10 — REPRESENTATIONS AND WARRANTIES OF THE INDEPENDENT DIRECTOR

The Independent Director hereby represents and warrants to the Company, the Member, the Senior Lender, and the Mezzanine Lender, as of the Effective Date and as of the date of each annual Independence Certification delivered pursuant to Section 2.3 hereof, as follows:

(a) Independence. The Independent Director satisfies each of the Independence Requirements set forth in Section 2 hereof as of the Effective Date and is not aware of any facts, circumstances, or relationships that are reasonably likely to cause the Independent Director to cease to satisfy any such Independence Requirement during the term of the Independent Director's service.

(b) Familiarity with Governing Documents. The Independent Director has reviewed and is familiar with the provisions of the LLC Agreement, the Senior Loan Agreement, and the Mezzanine Loan Agreement relating to the SPE Requirements, the Separateness Covenants, and the role, rights, duties, and obligations of the Independent Director, and the Independent Director understands the purpose and significance of such provisions in the context of the Company's bankruptcy-remote structure.

(c) No Disqualifying Events. The Independent Director has not been convicted of a felony or been the subject of any order, judgment, decree, or sanction of any court, regulatory body, or governmental authority permanently or temporarily barring, suspending, or otherwise restricting the Independent Director from acting as an officer, director, manager, or fiduciary of any corporation, limited liability company, partnership, trust, or other legal entity. The Independent Director is not the subject of any pending criminal proceeding or any pending regulatory proceeding that could result in such a bar, suspension, or restriction.

(d) No Conflicts of Interest. No conflict of interest exists between the Independent Director, on the one hand, and the Company, the Member, the Senior Lender, or the Mezzanine Lender, on the other hand, that would impair or could reasonably be expected to impair the Independent Director's ability to serve independently and impartially in accordance with this Agreement and the LLC Agreement.

(e) Reliance by Lenders. The Independent Director acknowledges and agrees that the Senior Lender and the Mezzanine Lender are entering into the Loan Agreements and advancing funds thereunder in reliance upon the Independent Director's service and the Independent Director's undertaking of the obligations set forth in this Agreement. The Independent Director further acknowledges that the representations, warranties, and covenants of the Independent Director set forth herein are material to the Senior Lender's and the Mezzanine Lender's decision to extend credit to the Company and HYW Mezzanine, respectively.

(f) Capacity and Authority. The Independent Director has the legal capacity to enter into this Agreement and to perform the Independent Director's obligations hereunder. The execution, delivery, and performance of this Agreement by the Independent Director do not and will not violate any agreement, order, judgment, or decree to which the Independent Director is a party or by which the Independent Director is bound.

SECTION 11 — COVENANTS OF THE COMPANY AND THE MEMBER

The Company and MTDC hereby covenant and agree with the Independent Director and, as express third-party beneficiaries hereof, with the Senior Lender and the Mezzanine Lender, as follows:

(a) Compliance with Separateness Covenants and SPE Requirements. The Company shall comply with the Separateness Covenants and the SPE Requirements at all times while any amount remains outstanding under the Senior Loan or the Mezzanine Loan, and MTDC shall not take, and shall not direct the Company to take, any action that would cause the Company to fail to comply with the Separateness Covenants or the SPE Requirements.

(b) No Adverse Amendments. The Company shall not amend, modify, restate, or supplement the LLC Agreement or the Certificate of Formation so as to modify, limit, or eliminate the Independent Director's consent rights over Material Actions, or to alter the Independence Requirements, without the prior written consent of the Senior Lender and the Mezzanine Lender, and any such amendment or modification made without such consent shall be void and of no force or effect.

(c) Notice of Proposed Material Actions. The Company shall provide the Independent Director with prompt written notice (and copies of all relevant documentation reasonably necessary for the Independent Director's evaluation) of any proposed Material Action, together with a reasonable period of not less than five (5) business days in which to review and consider such proposed Material Action before the Independent Director is required to vote or provide written consent thereon. The Company shall also provide the Senior Lender and the Mezzanine Lender with prompt notice of any proposed Material Action to the extent required by the Loan Agreements.

(d) Maintenance of LLC Agreement Provisions. The Company shall cause the LLC Agreement at all times to include the SPE Requirements and Independent Director provisions required under the Senior Loan Agreement and the Mezzanine Loan Agreement, and shall not permit any amendment or restatement of the LLC Agreement that would eliminate or impair such provisions.

(e) No Unauthorized Material Actions. MTDC, as sole Member of the Company, shall not direct or cause the Company to take any Material Action without obtaining the Independent Director's prior written consent in accordance with Section 5 hereof, and shall not take any action to circumvent or undermine the Independent Director's consent rights.

(f) Cooperation. The Company and MTDC shall cooperate with the Independent Director and provide such information and access to the Company's books, records, and personnel as the Independent Director may reasonably request in connection with the performance of the Independent Director's duties hereunder.

SECTION 12 — THIRD-PARTY BENEFICIARY RIGHTS

12.1 Designation of Third-Party Beneficiaries. The Senior Lender (Ironclad National Bank, N.A., as Administrative Agent) and the Mezzanine Lender (Granite Peak Capital Partners, LP) are express third-party beneficiaries of this Agreement, including, without limitation, of the Independence Requirements set forth in Section 2, the Material Action consent rights set forth in Section 5, the term, removal, and replacement provisions set forth in Section 7, and the covenants of the Company and the Member set forth in Section 11. The parties intend that the Senior Lender and the Mezzanine Lender shall have enforceable rights under each such provision as if they were direct parties hereto.

12.2 Right to Enforce. The Senior Lender and the Mezzanine Lender shall each have the right, but not the obligation, to enforce the terms and conditions of this Agreement directly against the Company, the Member, or the Independent Director, as applicable, through any legal or equitable remedy available at law or in equity, including, without limitation, injunctive relief and specific performance. The exercise or non-exercise by the Senior Lender or the Mezzanine Lender of any right hereunder shall not be deemed a waiver of any other right or remedy.

12.3 Consent to Amendment or Termination. No amendment, modification, waiver, or termination of any provision of this Agreement shall be effective without the prior written consent of the Senior Lender and the Mezzanine Lender so long as any amount remains outstanding under the Senior Loan or the Mezzanine Loan. Any purported amendment, modification, waiver, or termination made without such consent shall be void and of no force or effect.

SECTION 13 — NO PETITION COVENANT

13.1 Covenant. The Independent Director, in its capacity as Independent Director and not individually, and the Company each hereby covenant and agree that they shall not, prior to the date that is one (1) year and one (1) day (or, if longer, the applicable preference period under the United States Bankruptcy Code plus one (1) day) after the date on which the Senior Loan and the Mezzanine Loan have been irrevocably repaid in full and all obligations of the Company and HYW Mezzanine under the Loan Agreements have been indefeasibly discharged, acquiesce, petition, or otherwise invoke or cause any other person to invoke the process of any court, governmental authority, or administrative body for the purpose of: (a) commencing or sustaining a case against the Company or the Member under any federal or state bankruptcy, insolvency, reorganization, receivership, or similar law (including, without limitation, the United States Bankruptcy Code); or (b) appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator, or other similar official for the Company or the Member or for any substantial part of either's property.

13.2 Survival. The covenant set forth in this Section 13 shall survive the termination of this Agreement and the Independent Director's resignation or removal and shall be binding upon the Independent Director's heirs, executors, administrators, and personal representatives.

13.3 Enforceability. This Section 13 is a material inducement for the Senior Lender's and the Mezzanine Lender's entry into the Loan Agreements and shall be enforceable by the Senior Lender and the Mezzanine Lender as third-party beneficiaries hereof.

SECTION 14 — NOTICES

All notices, requests, demands, consents, approvals, and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given: (a) when delivered by hand; (b) one (1) business day after being sent by nationally recognized overnight courier service (prepaid); (c) three (3) business days after being sent by certified United States mail, return receipt requested, postage prepaid; or (d) when sent by email (with written confirmation of receipt by the addressee), in each case to the following addresses (or to such other address as any party may specify by notice to the others in accordance with this Section 14):

If to the Company:

Hudson Yards West Mortgage LLC c/o Metropolitan Transit Development Corp. 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604

Attention: Lydia Okafor, General Counsel

Email: lokafor@mtdc-corp.com

with a copy (which shall not constitute notice) to:

Marcus Jennings, Vice President, Real Estate Development 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604

Email: mjennings@mtdc-corp.com

If to the Member (MTDC):

Metropolitan Transit Development Corp. 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604

Attention: David Harrington, Executive Director

Email: dharrington@mtdc-corp.com

with a copy (which shall not constitute notice) to:

Lydia Okafor, General Counsel 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604

Email: lokafor@mtdc-corp.com

If to the Independent Director:

________________________________________

Email: ______

If to the Senior Lender:

Ironclad National Bank, N.A. 277 Park Avenue New York, New York 10172

Attention: Kenneth Pryor, Managing Director, Real Estate Finance

Email: kpryor@ironcladbank.com

with a copy (which shall not constitute notice) to:

Clearfield & Associates LLP 399 Park Avenue, 28th Floor New York, New York 10022

Attention: Harrison Whitmore

Email: hwhitmore@clearfieldlaw.com

If to the Mezzanine Lender:

Granite Peak Capital Partners, LP 9 West 57th Street, Suite 4200 New York, New York 10019

Attention: Diane Castellano, Managing Partner

Email: dcastellano@granitepeakcap.com

with a copy (which shall not constitute notice) to:

Voss Richter & Baines LLP 1251 Avenue of the Americas, 34th Floor New York, New York 10020

Attention: Natasha Ivanovic

Email: nivanovic@vrblaw.com

SECTION 15 — MISCELLANEOUS

Section 15.1 — Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to its conflict of laws principles that would cause the application of the laws of any other jurisdiction, including, without limitation, the Delaware Limited Liability Company Act, 6 Del. C. § 18-101 et seq. The parties acknowledge that this Agreement relates to the internal affairs of a Delaware limited liability company and that the application of Delaware law is essential to the parties' expectations and the bankruptcy-remote structure of the Company.

Section 15.2 — Jurisdiction; Venue; Waiver of Jury Trial

The parties hereby irrevocably submit to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or, if such court declines to exercise jurisdiction, the Superior Court of the State of Delaware, or the United States District Court for the District of Delaware) for the purposes of any suit, action, or other proceeding arising out of or relating to this Agreement, and each party irrevocably waives any objection to such jurisdiction or venue, including any objection based on forum non conveniens. Process in any such suit, action, or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court.

WAIVER OF JURY TRIAL. EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY SUCH PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 15.2.

Section 15.3 — Entire Agreement

This Agreement, together with the LLC Agreement, constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, representations, and warranties, whether oral or written, relating to the subject matter hereof. No party has relied on any representation or warranty not expressly set forth in this Agreement or the LLC Agreement.

Section 15.4 — Amendment; Waiver

No amendment, modification, supplement, or waiver of any provision of this Agreement shall be effective unless set forth in a written instrument duly executed by each of the Company, the Member, the Independent Director, the Senior Lender, and the Mezzanine Lender. No failure or delay by any party in exercising any right, power, or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law.

Section 15.5 — Severability

If any term, provision, covenant, or restriction of this Agreement is held by a court of competent jurisdiction or other governmental authority to be invalid, void, or unenforceable, the remainder of the terms, provisions, covenants, and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired, or invalidated, so long as the economic and legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term, provision, covenant, or restriction is invalid, void, or unenforceable, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner.

Section 15.6 — Assignment

The Independent Director may not assign, delegate, or otherwise transfer any of the Independent Director's duties, obligations, or rights under this Agreement without the prior written consent of the Company, the Member, the Senior Lender, and the Mezzanine Lender. The Company may not assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the Senior Lender and the Mezzanine Lender. Any purported assignment in violation of this Section 15.6 shall be void and of no force or effect.

Section 15.7 — Counterparts; Electronic Execution

This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by electronic transmission (including by email in portable document format (.pdf)) shall be deemed to be, and shall be effective as, delivery of an original executed counterpart of this Agreement. Electronic signatures complying with the federal ESIGN Act (15 U.S.C. § 7001 et seq.) or the Uniform Electronic Transactions Act, as adopted in the applicable jurisdiction, shall be deemed original signatures for all purposes of this Agreement.

Section 15.8 — Headings

The section and subsection headings contained in this Agreement are for reference and convenience only, shall not be deemed part of this Agreement, and shall not affect in any way the meaning, interpretation, or enforceability of any provision hereof.

Section 15.9 — Interpretation

References in this Agreement to the Senior Loan Agreement, the Mezzanine Loan Agreement, and the LLC Agreement shall include all amendments, supplements, restatements, and modifications thereof from time to time in effect in accordance with their respective terms. Defined terms used in this Agreement shall have the same meanings when used in any notice, certificate, consent, or other document delivered pursuant to or in connection with this Agreement, unless the context otherwise requires. As used herein, (a) the words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation"; (b) the word "or" is not exclusive; (c) references to a "person" shall include any natural person,

INDEPENDENT DIRECTOR DESIGNATION AGREEMENT
of
HUDSON YARDS WEST MORTGAGE LLC
a Delaware Limited Liability Company
Dated as of ______________, 2025
INDEPENDENT DIRECTOR DESIGNATION AGREEMENT
This INDEPENDENT DIRECTOR DESIGNATION AGREEMENT (this "Agreement") is entered into as of ____, 2025, by and among **HUDSON YARDS WEST MORTGAGE LLC**, a Delaware limited liability company (the "Company" or "HYW Mortgage"), **METROPOLITAN TRANSIT DEVELOPMENT CORP.**, an Illinois corporation ("MTDC" or the "Member"), and **______ (the "Independent Director"), and acknowledged and agreed by IRONCLAD NATIONAL BANK, N.A., a national banking association, in its capacity as Administrative Agent under the Senior Loan Agreement (as defined below) (the "Senior Lender" or "Ironclad"), and GRANITE PEAK CAPITAL PARTNERS, LP**, a Delaware limited partnership (the "Mezzanine Lender" or "Granite Peak"), each in its capacity as a third-party beneficiary hereof.
RECITALS
WHEREAS, Hudson Yards West Mortgage LLC ("HYW Mortgage" or the "Company") is a Delaware limited liability company and special purpose entity, duly formed and existing under the laws of the State of Delaware, organized for the purpose of owning, developing, and financing the mixed-use commercial and residential development project located at 450 West 34th Street, New York, New York 10001 (Borough of Manhattan; Tax Block 729; Tax Lots 1, 5, 12, and 15) (the "Project"), which Project includes office, retail, and residential components with an aggregate estimated development cost in excess of Six Hundred Seventy-Five Million Dollars ($675,000,000);
WHEREAS, Metropolitan Transit Development Corp. ("MTDC"), as the sole member of the Company, organized the Company as a bankruptcy-remote, single purpose entity in connection with the Company's entry into that certain Senior Mortgage Loan in the original principal amount of Four Hundred Seventy-Five Million Dollars ($475,000,000) with Ironclad National Bank, N.A. ("Ironclad"), as Administrative Agent, and the syndicate of lenders party thereto (the "Senior Loan"), and the related mezzanine financing in the original principal amount of Two Hundred Million Dollars ($200,000,000) provided by Granite Peak Capital Partners, LP ("Granite Peak"), to Hudson Yards West Mezzanine LLC ("HYW Mezzanine"), a Delaware limited liability company and the direct parent of the Company (the "Mezzanine Loan");
WHEREAS, the Amended and Restated Limited Liability Company Agreement of the Company, dated as of ____, 2025 (as amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms, the "LLC Agreement"), requires that the Company at all times have at least one (1) Independent Director (as defined herein) whose affirmative vote is required before the Company may take certain Material Actions (as defined herein);
WHEREAS, the requirement for an Independent Director is a condition precedent to the closing and initial funding of the Senior Loan and the Mezzanine Loan and is intended to ensure the separateness of the Company from its member and affiliates and to minimize the risk of a substantive consolidation of the Company's assets and liabilities with those of any other person or entity in any bankruptcy, insolvency, or similar proceeding, consistent with the nonconsolidation opinion delivered by counsel in connection with the closing of the Senior Loan;
WHEREAS, the Independent Director has been selected by MTDC, as sole Member of the Company, and is willing to serve as an Independent Director of the Company on the terms and conditions set forth herein, having represented that the Independent Director satisfies each of the Independence Requirements (as defined herein) and possesses experience in serving as an independent director or independent manager for special purpose entities in structured finance and commercial real estate transactions;
WHEREAS, reference is hereby made to that certain Senior Mortgage Loan Agreement dated as of ____, 2025 (as amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms, the "Senior Loan Agreement"), among the Company, as Borrower, and Ironclad National Bank, N.A., as Administrative Agent for the benefit of itself and the syndicate of lenders party thereto, and to that certain Mezzanine Loan Agreement dated as of ____, 2025 (as amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms, the "Mezzanine Loan Agreement," and together with the Senior Loan Agreement, the "Loan Agreements"), among Hudson Yards West Mezzanine LLC, as Borrower, and Granite Peak Capital Partners, LP, as Lender; and
WHEREAS, it is the intent of the parties that this Agreement be executed and delivered on or prior to the closing date of the Senior Loan and the Mezzanine Loan and that the Independent Director commence service as of the Effective Date (as defined herein);
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION 1 — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings ascribed to them below:
"Agreement" shall mean this Independent Director Designation Agreement, as it may be amended, restated, supplemented, or otherwise modified from time to time in accordance with Section 15.4 hereof.
"Annual Fee" shall have the meaning set forth in Section 8 hereof.
"Certificate of Formation" shall mean the Certificate of Formation of the Company filed with the Secretary of State of the State of Delaware, as the same may be amended or restated from time to time in accordance with the LLC Agreement and this Agreement.
"Company" shall mean Hudson Yards West Mortgage LLC, a Delaware limited liability company.
"Covered Person" shall have the meaning ascribed to such term in the LLC Agreement, and shall include the Independent Director in the Independent Director's capacity as such.
"Effective Date" shall have the meaning set forth in Section 3 hereof.
"HYW Mezzanine" shall mean Hudson Yards West Mezzanine LLC, a Delaware limited liability company and the direct parent of the Company.
"Independence Requirements" shall mean the criteria enumerated in Section 2 hereof, which are intended to conform to, and incorporate by reference, the requirements of the LLC Agreement, the Senior Loan Agreement, and the Mezzanine Loan Agreement, as well as the rating criteria of Pinnacle Ratings Group applicable to independent directors of special purpose entities in rated transactions (including, without limitation, rating identifier PRG-MTDC-A-2024-1187).
"Independent Director" shall mean the individual designated pursuant to this Agreement to serve in such capacity, initially being ______, and any successor Independent Director appointed in accordance with Section 7 hereof; provided, that any person serving as Independent Director must at all times satisfy the Independence Requirements set forth in Section 2 hereof.
"LLC Agreement" shall mean the Amended and Restated Limited Liability Company Agreement of the Company dated as of ____, 2025, as the same may be further amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms (subject to the restrictions on amendment without Independent Director consent as set forth therein and in Section 5 hereof).
"Loan Agreements" shall mean, collectively, the Senior Loan Agreement and the Mezzanine Loan Agreement.
"Material Action" shall mean each of the enumerated actions set forth in Section 5 hereof for which the prior affirmative consent of the Independent Director is required, as further described in the LLC Agreement and the Senior Loan Agreement.
"Member" shall mean MTDC, as the sole member of the Company, and its permitted successors and assigns in such capacity.
"Mezzanine Lender" shall mean Granite Peak Capital Partners, LP, and its successors and assigns under the Mezzanine Loan Agreement.
"Mezzanine Loan" shall mean the mezzanine loan in the original principal amount of Two Hundred Million Dollars ($200,000,000) made by the Mezzanine Lender to HYW Mezzanine pursuant to the Mezzanine Loan Agreement.
"Mezzanine Loan Agreement" shall have the meaning set forth in the Recitals hereof.
"MTDC" shall mean Metropolitan Transit Development Corp., an Illinois corporation.
"Pinnacle Ratings Group" shall mean Pinnacle Ratings Group, Inc. and any successor rating agency.
"Project" shall have the meaning set forth in the Recitals hereof.
"Senior Lender" shall mean Ironclad National Bank, N.A., in its capacity as Administrative Agent under the Senior Loan Agreement, and its successors and assigns in such capacity.
"Senior Loan" shall mean the senior mortgage loan in the original principal amount of Four Hundred Seventy-Five Million Dollars ($475,000,000) made by the syndicate of lenders party to the Senior Loan Agreement to the Company pursuant to the Senior Loan Agreement.
"Senior Loan Agreement" shall have the meaning set forth in the Recitals hereof.
"Separateness Covenants" shall mean the covenants set forth in the LLC Agreement and the Loan Agreements requiring the Company to maintain its existence as a legal entity separate and distinct from the Member and any other person, as more particularly summarized in Exhibit B attached hereto.
"SPE Requirements" shall mean the single-purpose entity and bankruptcy-remoteness requirements set forth in the Senior Loan Agreement (and incorporated by reference in the Mezzanine Loan Agreement), the LLC Agreement, and the nonconsolidation opinion delivered by counsel in connection with the closing of the Senior Loan, as more particularly summarized in Exhibit B attached hereto.
Capitalized terms used but not otherwise defined in this Agreement shall have the meanings ascribed to such terms in the LLC Agreement. If any capitalized term is not defined in this Agreement or the LLC Agreement, such term shall have the meaning ascribed to it in the Senior Loan Agreement. In the event of any conflict between the definitions set forth in this Agreement and those set forth in the LLC Agreement or the Senior Loan Agreement, the definitions set forth in this Agreement shall control for purposes of interpreting this Agreement, and the definitions set forth in the Senior Loan Agreement shall control for purposes of determining compliance with the SPE Requirements and Separateness Covenants.
SECTION 2 — INDEPENDENCE REQUIREMENTS; QUALIFICATION
2.1 Independence Representations and Covenants. The Independent Director represents, warrants, and covenants that at the time of designation and at all times throughout the term of the Independent Director's service hereunder, the Independent Director:
(a) Is not, and has not been at any time during the preceding five (5) years: (i) a stockholder, member, partner, director (other than as an independent director or independent manager), officer, employee, affiliate, associate, supplier, or creditor of the Company, the Member (MTDC), HYW Mezzanine, or any of their respective affiliates (other than in a prior capacity as an independent director or independent manager of a special purpose entity that is not affiliated with MTDC and in which the Independent Director's service was limited to the role of independent director or independent manager); (ii) a customer, supplier, consultant, or other person who derives more than a de minimis amount of revenues, fees, or other compensation from the Company, MTDC, or any affiliate of MTDC (for purposes of this clause, "de minimis" shall mean an amount not exceeding Five Thousand Dollars ($5,000) in any twelve-month period); or (iii) a member of the immediate family (including spouse, domestic partner, parent, child, sibling, or any person sharing the Independent Director's household) of any person described in clauses (i) or (ii) above;
(b) Is not, and has not been at any time during the preceding five (5) years, a director, officer, employee, partner, member, agent, representative, or consultant of Ironclad National Bank, N.A., Granite Peak Capital Partners, LP, Ridgeline Savings Bank, Atlas Mutual Insurance Company, Harborview Federal Savings Bank, Meridian Pacific Bank, or any other lender under the Senior Loan or the Mezzanine Loan, or any affiliate, parent, subsidiary, or successor of any of the foregoing entities, and has not received any compensation, fees, or other remuneration from any such entity (other than fees payable for service as an independent director of an unaffiliated entity);
(c) Has prior experience serving as an independent director or independent manager of a special purpose entity in structured finance, securitization, or commercial mortgage-backed securities ("CMBS") transactions, and possesses a working familiarity with the purposes and responsibilities of an independent director in a bankruptcy-remote structure;
(d) Understands and acknowledges the duties described in this Agreement and in the LLC Agreement, including, without limitation, the obligation to consider the interests of the Company and its creditors (including the Senior Lender and the Mezzanine Lender) in connection with Material Actions, and the obligation to exercise independent judgment in passing upon proposed Material Actions without direction from or deference to the Member or its affiliates;
(e) Meets such additional independence criteria as may be required from time to time by Pinnacle Ratings Group (currently reflected in rating identifier PRG-MTDC-A-2024-1187) in connection with the MTDC credit rating, any securitization, syndication, or other disposition of the Senior Loan or the Mezzanine Loan, or any future rated transaction involving the Company or HYW Mezzanine; and
(f) Is not a person with respect to whom there exist any facts, circumstances, or relationships (financial, familial, professional, or otherwise) that would, in the reasonable judgment of a disinterested observer, compromise or appear to compromise the Independent Director's ability to exercise independent and impartial judgment in connection with any Material Action.
2.2 Ongoing Compliance. The Independent Director shall continuously satisfy each of the Independence Requirements set forth in this Section 2 throughout the term of the Independent Director's service. The Independent Director shall promptly (and in any event within five (5) business days) notify the Company, the Member, the Senior Lender, and the Mezzanine Lender in writing if the Independent Director at any time ceases to satisfy, or becomes aware of any facts or circumstances that may cause the Independent Director to cease to satisfy, any of the foregoing Independence Requirements.
2.3 Annual Certification. The Independent Director shall deliver to the Company, the Senior Lender, and the Mezzanine Lender, on or before January 15 of each calendar year during the term of the Independent Director's service (and upon the Independent Director's initial appointment), a written certification in the form attached hereto as Exhibit A confirming the Independent Director's continued compliance with the Independence Requirements.
SECTION 3 — DESIGNATION AND APPOINTMENT
3.1 Appointment. MTDC, as the sole Member of the Company, hereby designates and appoints ______ as the Independent Director of the Company, effective as of ____, 2025 (the "Effective Date"), which date shall be on or before the closing date of the Senior Loan (target closing date: June 15, 2025). The Independent Director hereby accepts such designation and appointment and agrees to serve in such capacity on the terms and conditions set forth in this Agreement and in the LLC Agreement.
3.2 Authorization. The Independent Director is designated pursuant to and in accordance with Article _ of the LLC Agreement, which provides for the appointment of at least one (1) Independent Director, and Section _ of the Senior Loan Agreement, which requires the Company to maintain at least one (1) Independent Director satisfying the Independence Requirements at all times while any amount remains outstanding under the Senior Loan.
3.3 Condition Precedent. The parties acknowledge and agree that the appointment of the Independent Director is a condition precedent to the initial funding of the Senior Loan under the Senior Loan Agreement and to the initial funding of the Mezzanine Loan under the Mezzanine Loan Agreement. Neither the Senior Lender nor the Mezzanine Lender shall be obligated to fund any amount under the respective Loan Agreements until this Agreement has been duly executed and delivered by all parties hereto and the Independent Director has commenced service.
3.4 Company Records and Filings. The Independent Director shall be listed in the Company's books and records as an Independent Director. To the extent required by applicable law or the LLC Agreement, the Company shall reflect the Independent Director's designation in filings with the Secretary of State of the State of Delaware or any other applicable governmental authority. The Company shall also provide a copy of this Agreement (or a summary thereof) to any rating agency, servicer, or trustee that may require evidence of the Independent Director's appointment in connection with any securitization or syndication of the Senior Loan.
SECTION 4 — DUTIES AND RESPONSIBILITIES
4.1 Scope of Duties. The Independent Director's duties and responsibilities under this Agreement and the LLC Agreement are strictly limited to the following:
(a) Participating in deliberations concerning, and voting upon, any proposed Material Action (as enumerated in Section 5 hereof), upon receipt of notice thereof from the Member or any officer of the Company;
(b) Receiving and reviewing notice of any proposed Material Action from the Member, any officer, or any authorized representative of the Company, together with such supporting documentation and information as is reasonably necessary for the Independent Director to evaluate the proposed Material Action;
(c) Exercising good faith business judgment independently of the Member and its affiliates in determining whether to consent to any Material Action, taking into account the considerations set forth in Section 4.1(d) below;
(d) Considering, in connection with any determination with respect to a proposed Material Action, the interests of the Company as a separate legal entity, the interests of the Company's creditors (including, without limitation, the Senior Lender and the Mezzanine Lender), and the interests of all other stakeholders in the Company, and giving appropriate weight to such interests in light of the Company's status as a bankruptcy-remote, single purpose entity; and
(e) Performing such other duties as are expressly set forth in the LLC Agreement or the Senior Loan Agreement with respect to the role of the Independent Director, including, without limitation, executing any written consent or resolution required to evidence the Independent Director's approval or disapproval of a proposed Material Action.
4.2 No Management Authority. The Independent Director shall not have any management authority over, or fiduciary obligations with respect to, the day-to-day operations, business strategy, or commercial affairs of the Company beyond those expressly set forth in this Agreement and the LLC Agreement. The Member shall retain sole authority and responsibility for the management and conduct of the Company's business in all respects, subject to the Independent Director's consent rights over Material Actions. The Independent Director shall not be responsible for monitoring the Company's compliance with the Loan Agreements, the Separateness Covenants, or the SPE Requirements except as such compliance may be relevant to the Independent Director's consideration of a proposed Material Action.
4.3 No Authority to Bind. The Independent Director shall have no authority to bind the Company, to execute agreements or instruments on behalf of the Company, or to act as an agent of the Company, except as expressly set forth in this Agreement or the LLC Agreement with respect to the approval or disapproval of Material Actions.
4.4 Independent Contractor Status. The Independent Director shall not be deemed to be an "employee" of the Company, the Member, or any affiliate of the Member for any purpose, including, without limitation, for purposes of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), the Internal Revenue Code of 1986, as amended (the "Code"), federal, state, or local employment tax withholding, workers' compensation, unemployment insurance, or any other employment-related law or regulation. The Independent Director shall be solely responsible for the payment of all taxes arising from or relating to the compensation received by the Independent Director under this Agreement.
SECTION 5 — MATERIAL ACTIONS; CONSENT RIGHTS
5.1 Enumerated Material Actions. The Company and the Member hereby covenant and agree that neither the Company nor any person acting on behalf of the Company shall take any of the following actions (each, a "Material Action") without the prior unanimous written consent of the Independent Director (together with the consent of the Member as required by the LLC Agreement):
(a) Filing or consenting to the filing of any petition for relief under the United States Bankruptcy Code (Title 11 of the United States Code), as amended from time to time, or any similar proceeding under any federal, state, or foreign bankruptcy, insolvency, reorganization, receivership, dissolution, or similar law, on behalf of the Company;
(b) Consenting to the institution of involuntary bankruptcy or insolvency proceedings against the Company, or failing to contest in a timely and appropriate manner any such involuntary proceeding;
(c) Consenting to the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator, or other similar official for the Company or for any substantial part of the Company's assets, or failing to contest in a timely and appropriate manner any such appointment;
(d) Making an assignment for the benefit of creditors of the Company, or admitting in writing the Company's inability to pay its debts generally as they become due;
(e) Admitting in writing the Company's inability to pay its debts as they become due, or taking any action that would constitute an act of insolvency under applicable law;
(f) Dissolving, liquidating, winding up, or terminating the Company, whether voluntarily or by consent;
(g) Merging or consolidating the Company with or into any other entity, or converting the Company into another form of entity;
(h) Transferring all or substantially all of the Company's assets, or any interest in the Project, other than in accordance with the express terms of the Loan Agreements and the LLC Agreement;
(i) Amending, modifying, restating, or supplementing the LLC Agreement or the Certificate of Formation in a manner that would (i) modify, limit, or eliminate any of the SPE Requirements or the Separateness Covenants, (ii) modify the rights, duties, qualifications, or consent rights of the Independent Director, (iii) adversely affect the interests of the Senior Lender or the Mezzanine Lender, or (iv) change the purpose of the Company or expand the scope of the Company's permitted activities beyond those contemplated by the Loan Agreements;
(j) Incurring any indebtedness, guaranteeing the obligations of any other person, or creating or permitting any lien on the Company's assets, other than as expressly permitted under the Senior Loan Agreement and the Mezzanine Loan Agreement;
(k) Engaging in any transaction with the Member or any affiliate of the Member except on arm's-length terms in the ordinary course of business and in compliance with the Separateness Covenants;
(l) Taking any action, or failing to take any action, that would cause the Company to fail to satisfy any of the Separateness Covenants or the SPE Requirements set forth in the LLC Agreement, the Senior Loan Agreement, or the Mezzanine Loan Agreement.
5.2 Standard for Evaluation of Bankruptcy-Related Actions. The Independent Director shall not be required to consider the interests of the Member or any affiliate of the Member (including MTDC) to the extent that such interests conflict with the interests of the Company's creditors (including the Senior Lender and the Mezzanine Lender) in passing upon any Material Action, particularly those described in clauses (a) through (f) of Section 5.1 above. In evaluating any proposed Material Action described in clauses (a) through (f) of Section 5.1, the Independent Director shall give primary consideration to the interests of the Company as a separate legal entity and the interests of the Company's creditors and shall exercise independent judgment free from the direction, influence, or control of the Member.
5.3 Enforceability by Third-Party Beneficiaries. The consent right of the Independent Director with respect to Material Actions is a fundamental term of this Agreement, the LLC Agreement, and the Loan Agreements. Such consent right shall be enforceable by the Senior Lender and the Mezzanine Lender as express third-party beneficiaries hereof, and the Company, the Member, and the Independent Director each acknowledge and agree that the Senior Lender and the Mezzanine Lender are relying upon the enforceability of the Independent Director's consent rights in entering into the Loan Agreements and advancing funds thereunder. Any Material Action taken without the prior written consent of the Independent Director shall be void and of no force or effect.
5.4 Form of Consent. The Independent Director's consent to a Material Action may be evidenced by a written consent or resolution executed by the Independent Director, or by the Independent Director's affirmative vote at a duly convened meeting of the members and Independent Director of the Company at which the Independent Director is present in person or by telephone or video conference. The Company shall retain a copy of each such consent or resolution in its books and records and shall promptly deliver a copy to the Senior Lender and the Mezzanine Lender upon request.
SECTION 6 — STANDARD OF CARE; EXCULPATION
6.1 Standard of Care. The Independent Director shall exercise the care that a reasonably prudent person in a like position would exercise under similar circumstances. The Independent Director shall act in good faith and in a manner that the Independent Director reasonably believes to be in the best interests of the Company, giving due consideration to the interests of the Company's creditors (including the Senior Lender and the Mezzanine Lender) as contemplated by this Agreement and the LLC Agreement.
6.2 Exculpation. The Independent Director shall not be liable to the Company, the Member, the Senior Lender, the Mezzanine Lender, or any other person for any act or omission in the performance of the Independent Director's duties under this Agreement or the LLC Agreement, except for acts or omissions constituting willful misconduct, actual fraud, or gross negligence. Without limiting the generality of the foregoing, the Independent Director shall not be liable for (a) any error in judgment made in good faith, (b) any action taken or omitted to be taken in reliance upon the advice of legal counsel, financial advisors, or other professionals retained by the Company, or (c) any action taken or omitted to be taken in accordance with the direction of the Member, provided that the Independent Director acted in good faith and such action or omission does not constitute willful misconduct, actual fraud, or gross negligence.
6.3 Delaware Law. The parties acknowledge that Section 18-1101(e) of the Delaware Limited Liability Company Act, 6 Del. C. § 18-1101(e), permits a limited liability company agreement to expand, restrict, or eliminate the duties (including fiduciary duties) and liabilities of any person, including a member, manager, or other person, to a limited liability company or to another member or manager or other person that is a party to or is otherwise bound by a limited liability company agreement. The parties hereby confirm that the LLC Agreement and this Agreement may expand, restrict, or eliminate the duties and liabilities of the Independent Director to the maximum extent permitted under Delaware law, and that the standard of care and exculpation provisions set forth in this Section 6 are contractually agreed modifications to any default fiduciary duties that might otherwise apply.
6.4 No Personal Liability. The Independent Director shall not be personally liable for the debts, obligations, or liabilities of the Company, whether arising in contract, tort, or otherwise, solely by reason of serving as Independent Director. No creditor or other person having any claim against the Company shall have any recourse against the Independent Director in the Independent Director's personal capacity for the satisfaction of such claim, except to the extent of any claim against the Independent Director arising from the Independent Director's willful misconduct, actual fraud, or gross negligence.
6.5 Duty of Good Faith; No Obligation to Maximize Member Value. The Independent Director's sole duty in connection with any proposed Material Action shall be the duty of good faith as described in this Agreement and the LLC Agreement. The Independent Director shall have no obligation to maximize value for the Member or to defer to the business judgment of the Member. The Independent Director's consideration of the interests of the Company's creditors, particularly in the zone of insolvency or in connection with a proposed bankruptcy filing, shall not be deemed a breach of any duty owed to the Member, and the Member hereby expressly waives any claim against the Independent Director arising from the Independent Director's good faith exercise of the consent rights set forth in Section 5 hereof.
SECTION 7 — TERM; REMOVAL; REPLACEMENT
7.1 Term. The Independent Director's term of service shall commence on the Effective Date and shall continue until the earliest to occur of: (a) the date on which the Senior Loan and the Mezzanine Loan have been irrevocably repaid in full and all obligations of the Company and HYW Mezzanine under the Loan Agreements (including, without limitation, any indemnification obligations) have been indefeasibly discharged in full; (b) the effective date of the Independent Director's resignation, removal, or death, subject to the successor appointment requirements set forth in Sections 7.2 and 7.3 below; or (c) the dissolution of the Company following the full and irrevocable repayment of the Senior Loan and the Mezzanine Loan and the discharge of all obligations under the Loan Agreements.
7.2 Resignation. The Independent Director may resign from service upon not less than thirty (30) days' prior written notice to the Company, the Member, the Senior Lender, and the Mezzanine Lender, delivered in accordance with Section 14 hereof; provided, however, that such resignation shall not become effective until a successor Independent Director who satisfies each of the Independence Requirements set forth in Section 2 hereof has been duly designated by the Member and has accepted appointment in writing and the Company has delivered to the Senior Lender and the Mezzanine Lender a replacement Independent Director Designation Agreement and such other documentation as the Senior Lender or the Mezzanine Lender may reasonably request. In no event shall any resignation of the Independent Director result in a vacancy in the position of Independent Director while any amount remains outstanding under the Senior Loan or the Mezzanine Loan.
7.3 Removal. The Independent Director may be removed, with or without cause, only by the Member; provided, that (a) no such removal shall be effective without at least ten (10) business days' prior written notice to the Senior Lender and the Mezzanine Lender, delivered in accordance with Section 14 hereof, specifying the reasons for the removal (if any) and identifying the proposed successor Independent Director, and (b) no removal shall become effective unless and until a successor Independent Director who satisfies each of the Independence Requirements set forth in Section 2 hereof has been duly designated by the Member, has accepted appointment in writing, and the Company has delivered to the Senior Lender and the Mezzanine Lender a replacement Independent Director Designation Agreement and such other documentation as the Senior Lender or the Mezzanine Lender may reasonably request.
7.4 Replacement. Any successor Independent Director must satisfy each of the Independence Requirements of Section 2 hereof and must be reasonably acceptable to the Senior Lender and the Mezzanine Lender. The Company shall deliver to the Senior Lender and the Mezzanine Lender, at least five (5) business days prior to the effective date of any successor's appointment: (a) a fully executed replacement Independent Director Designation Agreement in substantially the form of this Agreement; (b) a completed Independence Certification in the form of Exhibit A attached hereto, executed by the proposed successor; and (c) such other documentation as the Senior Lender or the Mezzanine Lender may reasonably request, including evidence of the successor's qualifications and experience.
7.5 Vacancy. At no time while any amount remains outstanding under the Senior Loan or the Mezzanine Loan shall the Company be without an Independent Director who satisfies each of the Independence Requirements set forth in Section 2 hereof. Any period during which the Company does not have a duly appointed Independent Director satisfying the Independence Requirements shall constitute an event of default under the Senior Loan Agreement and the Mezzanine Loan Agreement, and the Member and the Company shall use their best efforts to fill any vacancy as promptly as practicable (and in any event within ten (10) business days of the occurrence of such vacancy).
SECTION 8 — COMPENSATION
8.1 Annual Fee. The Company shall pay the Independent Director an annual fee of $____ (the "Annual Fee"), payable in equal quarterly installments in advance on January 1, April 1, July 1, and October 1 of each calendar year during the term of the Independent Director's service (prorated for any partial quarter at the commencement or termination of service), in consideration for the Independent Director's agreement to serve as Independent Director and to be available to review and act upon Material Actions as and when presented.
8.2 Per-Meeting Fee. In addition to the Annual Fee, the Company shall pay the Independent Director a fee of $____ for each meeting, telephonic or video conference, or written consent action in which the Independent Director participates (each, a "Meeting Fee"). Meeting Fees shall be payable within thirty (30) days following the date of the applicable meeting or written consent action.
8.3 Operating Expense. All compensation payable to the Independent Director under this Section 8 shall be treated as an operating expense of the Company and shall be payable regardless of whether any Material Action is submitted to the Independent Director for consent during the applicable period. The Independent Director's entitlement to the Annual Fee and any Meeting Fee shall not be contingent upon the outcome of any vote or consent by the Independent Director on any proposed Material Action.
8.4 Non-Contingent Compensation. The Independent Director's fees shall not be contingent upon the outcome of any vote or consent by the Independent Director. No bonus, incentive, or success-based compensation shall be paid to the Independent Director in connection with the Independent Director's service hereunder.
8.5 Permitted Expense Under Loan Agreements. Payment of Independent Director compensation hereunder shall be a permitted operating expense under the Senior Loan Agreement and shall not be subject to any cash sweep, lockbox restriction, subordination, or other restriction on payment except as expressly provided in the Senior Loan Agreement, the Mezzanine Loan Agreement, or any intercreditor agreement among the Senior Lender, the Mezzanine Lender, and the Company or HYW Mezzanine. The Company shall include the estimated annual Independent Director compensation in its operating budget submitted to the Senior Lender and the Mezzanine Lender.
8.6 Expense Reimbursement. The Company shall reimburse the Independent Director for all reasonable and documented out-of-pocket expenses incurred by the Independent Director in connection with the performance of the Independent Director's duties hereunder, including, without limitation, travel expenses, document review expenses, and expenses of professional advisors consulted by the Independent Director in connection with any proposed Material Action, subject to the Company's reasonable expense reimbursement policies as in effect from time to time.
SECTION 9 — INDEMNIFICATION
9.1 Scope. The Company shall indemnify, defend, and hold harmless the Independent Director from and against any and all claims, actions, suits, proceedings, investigations, demands, losses, damages, liabilities, judgments, fines, penalties, costs, and expenses (including reasonable attorneys' fees, expert witness fees, and disbursements) (collectively, "Losses") arising out of or relating to the Independent Director's service in the capacity of Independent Director under this Agreement or the LLC Agreement, including, without limitation, any Losses arising out of any Material Action or the Independent Director's vote or consent (or refusal to vote or consent) with respect thereto; provided, however, that the Company shall not be obligated to indemnify the Independent Director to the extent that any such Losses are finally determined by a court of competent jurisdiction to have arisen from the Independent Director's willful misconduct, actual fraud, or gross negligence.
9.2 Advancement. The Company shall advance to the Independent Director, promptly upon written request, the costs of defense of any claim, action, suit, proceeding, or investigation with respect to which the Independent Director may be entitled to indemnification under this Section 9 (including reasonable attorneys' fees and disbursements incurred by the Independent Director in connection therewith), upon receipt of an undertaking by the Independent Director to repay such amounts if it is ultimately determined by a court of competent jurisdiction, in a final and non-appealable judgment, that the Independent Director is not entitled to indemnification hereunder. The Independent Director's right to advancement of expenses shall not be subject to any requirement that the Independent Director first seek recovery from any other source.
9.3 Insurance. The Company shall maintain, at its own expense, directors' and officers' liability insurance covering the Independent Director in an amount not less than Five Million Dollars ($5,000,000) and on terms (including coverage for acts and omissions of the Independent Director in the Independent Director's capacity as such) reasonably acceptable to the Senior Lender. The Company shall provide evidence of such insurance coverage to the Senior Lender and the Independent Director upon request.
9.4 Survival. The indemnification obligations of the Company under this Section 9 shall survive the termination or expiration of this Agreement, the Independent Director's resignation or removal, and the dissolution, liquidation, or winding up of the Company, and shall be binding on any successor to the Company, whether by merger, consolidation, acquisition of assets, or otherwise. The Company's indemnification obligations shall continue in full force and effect for a period of six (6) years following the termination of the Independent Director's service.
9.5 Personal Right. The Independent Director's right to indemnification and advancement of expenses hereunder is personal to the Independent Director and shall not inure to the benefit of any third party other than the Independent Director's heirs, executors, administrators, and personal representatives.
9.6 Source of Payment. The Company's indemnification obligations under this Section 9 shall be payable solely from the assets of the Company. MTDC, in its capacity as sole Member, shall have no personal liability for the Company's indemnification obligations hereunder except to the extent that MTDC has separately agreed in writing to fund the Company's obligations or to the extent that MTDC has received distributions from the Company in violation of the LLC Agreement or the Loan Agreements.
9.7 Non-Exclusivity. The indemnification and advancement rights provided in this Section 9 are in addition to, and not in lieu of, any other rights to which the Independent Director may be entitled under the LLC Agreement, any separate indemnification agreement, or applicable law. To the extent any provision of this Section 9 conflicts with any corresponding provision of the LLC Agreement, the provision that provides greater protection to the Independent Director shall control.
SECTION 10 — REPRESENTATIONS AND WARRANTIES OF THE INDEPENDENT DIRECTOR
The Independent Director hereby represents and warrants to the Company, the Member, the Senior Lender, and the Mezzanine Lender, as of the Effective Date and as of the date of each annual Independence Certification delivered pursuant to Section 2.3 hereof, as follows:
(a) Independence. The Independent Director satisfies each of the Independence Requirements set forth in Section 2 hereof as of the Effective Date and is not aware of any facts, circumstances, or relationships that are reasonably likely to cause the Independent Director to cease to satisfy any such Independence Requirement during the term of the Independent Director's service.
(b) Familiarity with Governing Documents. The Independent Director has reviewed and is familiar with the provisions of the LLC Agreement, the Senior Loan Agreement, and the Mezzanine Loan Agreement relating to the SPE Requirements, the Separateness Covenants, and the role, rights, duties, and obligations of the Independent Director, and the Independent Director understands the purpose and significance of such provisions in the context of the Company's bankruptcy-remote structure.
(c) No Disqualifying Events. The Independent Director has not been convicted of a felony or been the subject of any order, judgment, decree, or sanction of any court, regulatory body, or governmental authority permanently or temporarily barring, suspending, or otherwise restricting the Independent Director from acting as an officer, director, manager, or fiduciary of any corporation, limited liability company, partnership, trust, or other legal entity. The Independent Director is not the subject of any pending criminal proceeding or any pending regulatory proceeding that could result in such a bar, suspension, or restriction.
(d) No Conflicts of Interest. No conflict of interest exists between the Independent Director, on the one hand, and the Company, the Member, the Senior Lender, or the Mezzanine Lender, on the other hand, that would impair or could reasonably be expected to impair the Independent Director's ability to serve independently and impartially in accordance with this Agreement and the LLC Agreement.
(e) Reliance by Lenders. The Independent Director acknowledges and agrees that the Senior Lender and the Mezzanine Lender are entering into the Loan Agreements and advancing funds thereunder in reliance upon the Independent Director's service and the Independent Director's undertaking of the obligations set forth in this Agreement. The Independent Director further acknowledges that the representations, warranties, and covenants of the Independent Director set forth herein are material to the Senior Lender's and the Mezzanine Lender's decision to extend credit to the Company and HYW Mezzanine, respectively.
(f) Capacity and Authority. The Independent Director has the legal capacity to enter into this Agreement and to perform the Independent Director's obligations hereunder. The execution, delivery, and performance of this Agreement by the Independent Director do not and will not violate any agreement, order, judgment, or decree to which the Independent Director is a party or by which the Independent Director is bound.
SECTION 11 — COVENANTS OF THE COMPANY AND THE MEMBER
The Company and MTDC hereby covenant and agree with the Independent Director and, as express third-party beneficiaries hereof, with the Senior Lender and the Mezzanine Lender, as follows:
(a) Compliance with Separateness Covenants and SPE Requirements. The Company shall comply with the Separateness Covenants and the SPE Requirements at all times while any amount remains outstanding under the Senior Loan or the Mezzanine Loan, and MTDC shall not take, and shall not direct the Company to take, any action that would cause the Company to fail to comply with the Separateness Covenants or the SPE Requirements.
(b) No Adverse Amendments. The Company shall not amend, modify, restate, or supplement the LLC Agreement or the Certificate of Formation so as to modify, limit, or eliminate the Independent Director's consent rights over Material Actions, or to alter the Independence Requirements, without the prior written consent of the Senior Lender and the Mezzanine Lender, and any such amendment or modification made without such consent shall be void and of no force or effect.
(c) Notice of Proposed Material Actions. The Company shall provide the Independent Director with prompt written notice (and copies of all relevant documentation reasonably necessary for the Independent Director's evaluation) of any proposed Material Action, together with a reasonable period of not less than five (5) business days in which to review and consider such proposed Material Action before the Independent Director is required to vote or provide written consent thereon. The Company shall also provide the Senior Lender and the Mezzanine Lender with prompt notice of any proposed Material Action to the extent required by the Loan Agreements.
(d) Maintenance of LLC Agreement Provisions. The Company shall cause the LLC Agreement at all times to include the SPE Requirements and Independent Director provisions required under the Senior Loan Agreement and the Mezzanine Loan Agreement, and shall not permit any amendment or restatement of the LLC Agreement that would eliminate or impair such provisions.
(e) No Unauthorized Material Actions. MTDC, as sole Member of the Company, shall not direct or cause the Company to take any Material Action without obtaining the Independent Director's prior written consent in accordance with Section 5 hereof, and shall not take any action to circumvent or undermine the Independent Director's consent rights.
(f) Cooperation. The Company and MTDC shall cooperate with the Independent Director and provide such information and access to the Company's books, records, and personnel as the Independent Director may reasonably request in connection with the performance of the Independent Director's duties hereunder.
SECTION 12 — THIRD-PARTY BENEFICIARY RIGHTS
12.1 Designation of Third-Party Beneficiaries. The Senior Lender (Ironclad National Bank, N.A., as Administrative Agent) and the Mezzanine Lender (Granite Peak Capital Partners, LP) are express third-party beneficiaries of this Agreement, including, without limitation, of the Independence Requirements set forth in Section 2, the Material Action consent rights set forth in Section 5, the term, removal, and replacement provisions set forth in Section 7, and the covenants of the Company and the Member set forth in Section 11. The parties intend that the Senior Lender and the Mezzanine Lender shall have enforceable rights under each such provision as if they were direct parties hereto.
12.2 Right to Enforce. The Senior Lender and the Mezzanine Lender shall each have the right, but not the obligation, to enforce the terms and conditions of this Agreement directly against the Company, the Member, or the Independent Director, as applicable, through any legal or equitable remedy available at law or in equity, including, without limitation, injunctive relief and specific performance. The exercise or non-exercise by the Senior Lender or the Mezzanine Lender of any right hereunder shall not be deemed a waiver of any other right or remedy.
12.3 Consent to Amendment or Termination. No amendment, modification, waiver, or termination of any provision of this Agreement shall be effective without the prior written consent of the Senior Lender and the Mezzanine Lender so long as any amount remains outstanding under the Senior Loan or the Mezzanine Loan. Any purported amendment, modification, waiver, or termination made without such consent shall be void and of no force or effect.
SECTION 13 — NO PETITION COVENANT
13.1 Covenant. The Independent Director, in its capacity as Independent Director and not individually, and the Company each hereby covenant and agree that they shall not, prior to the date that is one (1) year and one (1) day (or, if longer, the applicable preference period under the United States Bankruptcy Code plus one (1) day) after the date on which the Senior Loan and the Mezzanine Loan have been irrevocably repaid in full and all obligations of the Company and HYW Mezzanine under the Loan Agreements have been indefeasibly discharged, acquiesce, petition, or otherwise invoke or cause any other person to invoke the process of any court, governmental authority, or administrative body for the purpose of: (a) commencing or sustaining a case against the Company or the Member under any federal or state bankruptcy, insolvency, reorganization, receivership, or similar law (including, without limitation, the United States Bankruptcy Code); or (b) appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator, or other similar official for the Company or the Member or for any substantial part of either's property.
13.2 Survival. The covenant set forth in this Section 13 shall survive the termination of this Agreement and the Independent Director's resignation or removal and shall be binding upon the Independent Director's heirs, executors, administrators, and personal representatives.
13.3 Enforceability. This Section 13 is a material inducement for the Senior Lender's and the Mezzanine Lender's entry into the Loan Agreements and shall be enforceable by the Senior Lender and the Mezzanine Lender as third-party beneficiaries hereof.
SECTION 14 — NOTICES
All notices, requests, demands, consents, approvals, and other communications required or permitted to be given under this Agreement shall be in writing and shall be deemed to have been duly given: (a) when delivered by hand; (b) one (1) business day after being sent by nationally recognized overnight courier service (prepaid); (c) three (3) business days after being sent by certified United States mail, return receipt requested, postage prepaid; or (d) when sent by email (with written confirmation of receipt by the addressee), in each case to the following addresses (or to such other address as any party may specify by notice to the others in accordance with this Section 14):
If to the Company:
Hudson Yards West Mortgage LLC c/o Metropolitan Transit Development Corp. 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604
Attention: Lydia Okafor, General Counsel
Email: lokafor@mtdc-corp.com
with a copy (which shall not constitute notice) to:
Marcus Jennings, Vice President, Real Estate Development 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604
Email: mjennings@mtdc-corp.com
If to the Member (MTDC):
Metropolitan Transit Development Corp. 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604
Attention: David Harrington, Executive Director
Email: dharrington@mtdc-corp.com
with a copy (which shall not constitute notice) to:
Lydia Okafor, General Counsel 200 South Michigan Avenue, Suite 3100 Chicago, Illinois 60604
Email: lokafor@mtdc-corp.com
If to the Independent Director:
________________________________________
________________________________________
________________________________________
Email: ______
If to the Senior Lender:
Ironclad National Bank, N.A. 277 Park Avenue New York, New York 10172
Attention: Kenneth Pryor, Managing Director, Real Estate Finance
Email: kpryor@ironcladbank.com
with a copy (which shall not constitute notice) to:
Clearfield & Associates LLP 399 Park Avenue, 28th Floor New York, New York 10022
Attention: Harrison Whitmore
Email: hwhitmore@clearfieldlaw.com
If to the Mezzanine Lender:
Granite Peak Capital Partners, LP 9 West 57th Street, Suite 4200 New York, New York 10019
Attention: Diane Castellano, Managing Partner
Email: dcastellano@granitepeakcap.com
with a copy (which shall not constitute notice) to:
Voss Richter & Baines LLP 1251 Avenue of the Americas, 34th Floor New York, New York 10020
Attention: Natasha Ivanovic
Email: nivanovic@vrblaw.com
SECTION 15 — MISCELLANEOUS
Section 15.1 — Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to its conflict of laws principles that would cause the application of the laws of any other jurisdiction, including, without limitation, the Delaware Limited Liability Company Act, 6 Del. C. § 18-101 et seq. The parties acknowledge that this Agreement relates to the internal affairs of a Delaware limited liability company and that the application of Delaware law is essential to the parties' expectations and the bankruptcy-remote structure of the Company.
Section 15.2 — Jurisdiction; Venue; Waiver of Jury Trial
The parties hereby irrevocably submit to the exclusive jurisdiction of the Court of Chancery of the State of Delaware (or, if such court declines to exercise jurisdiction, the Superior Court of the State of Delaware, or the United States District Court for the District of Delaware) for the purposes of any suit, action, or other proceeding arising out of or relating to this Agreement, and each party irrevocably waives any objection to such jurisdiction or venue, including any objection based on forum non conveniens. Process in any such suit, action, or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court.
WAIVER OF JURY TRIAL. EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY SUCH PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 15.2.
Section 15.3 — Entire Agreement
This Agreement, together with the LLC Agreement, constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, representations, and warranties, whether oral or written, relating to the subject matter hereof. No party has relied on any representation or warranty not expressly set forth in this Agreement or the LLC Agreement.
Section 15.4 — Amendment; Waiver
No amendment, modification, supplement, or waiver of any provision of this Agreement shall be effective unless set forth in a written instrument duly executed by each of the Company, the Member, the Independent Director, the Senior Lender, and the Mezzanine Lender. No failure or delay by any party in exercising any right, power, or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies provided by law.
Section 15.5 — Severability
If any term, provision, covenant, or restriction of this Agreement is held by a court of competent jurisdiction or other governmental authority to be invalid, void, or unenforceable, the remainder of the terms, provisions, covenants, and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired, or invalidated, so long as the economic and legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term, provision, covenant, or restriction is invalid, void, or unenforceable, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner.
Section 15.6 — Assignment
The Independent Director may not assign, delegate, or otherwise transfer any of the Independent Director's duties, obligations, or rights under this Agreement without the prior written consent of the Company, the Member, the Senior Lender, and the Mezzanine Lender. The Company may not assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the Senior Lender and the Mezzanine Lender. Any purported assignment in violation of this Section 15.6 shall be void and of no force or effect.
Section 15.7 — Counterparts; Electronic Execution
This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by electronic transmission (including by email in portable document format (.pdf)) shall be deemed to be, and shall be effective as, delivery of an original executed counterpart of this Agreement. Electronic signatures complying with the federal ESIGN Act (15 U.S.C. § 7001 et seq.) or the Uniform Electronic Transactions Act, as adopted in the applicable jurisdiction, shall be deemed original signatures for all purposes of this Agreement.
Section 15.8 — Headings
The section and subsection headings contained in this Agreement are for reference and convenience only, shall not be deemed part of this Agreement, and shall not affect in any way the meaning, interpretation, or enforceability of any provision hereof.
Section 15.9 — Interpretation
References in this Agreement to the Senior Loan Agreement, the Mezzanine Loan Agreement, and the LLC Agreement shall include all amendments, supplements, restatements, and modifications thereof from time to time in effect in accordance with their respective terms. Defined terms used in this Agreement shall have the same meanings when used in any notice, certificate, consent, or other document delivered pursuant to or in connection with this Agreement, unless the context otherwise requires. As used herein, (a) the words "include," "includes," and "including" shall be deemed to be followed by the phrase "without limitation"; (b) the word "or" is not exclusive; (c) references to a "person" shall include any natural person,

INDEPENDENT DIRECTOR DESIGNATION AGREEMENT

HUDSON YARDS WEST MORTGAGE LLC

INDEPENDENT DIRECTOR DESIGNATION AGREEMENT

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